Which Technology Should You Use- CRM or CDP?

CRM and CDP are two important parts of digital marketing that help you manage the relationship with your customers. Both CRM and CDP are used to organize customer data and allow you to take action on it. However, there are many differences between CRM vs CDP that make it hard for businesses to decide which one is best for them.

Customer relationship management

Customer relationship management (CRM) is a system that helps you manage customer relationships. It’s software that helps you to organize customer information and automate customer service processes.

In other words, CRM can be used to manage the customer lifecycle. You can use it to identify new leads, communicate with them through email campaigns or social media ads, and track their progress through the sales funnel so that they become customers.

Customer data platform

Customer data platforms (CDPs) are an umbrella term that describes a variety of technologies that help businesses manage their customer data. CDPs are designed to help marketers make more effective decisions by providing them with a single source of truth about their customers, including personal information and preferences. CDPs are often used as the foundation for other marketing technologies, such as CRMs and marketing automation systems.

While there isn’t a universal definition for what constitutes a customer data platform, they generally have some or all of the following features:

  • Integration with multiple channels (e.g., web forms, mobile apps);
  • The ability to store structured and unstructured data;
  • Data analytics capabilities;
  • An intuitive interface so that non-technical people can use it easily

CRM and CDP Focus Areas

The main difference between CRM and CDP is the focus. CRM focuses on customer data and interactions, while CDP centers around customer data and interactions. Both software solutions store, analyze and utilize this information to optimize sales performance.

CRM is a database of customer data and interactions with your company. At the same time, CDP is a database of customer data from sources outside your company (social media sites like Twitter or Facebook).

Adobe Real-Time CDP says, “CDPs track total customer behavior to show how audience segments interact with your brand and give you an idea of the complete customer journey. In addition, they automatically collect, integrate, clean, and consolidate user behavior data using integrations and code snippets.”

CDP vs CRM Comparison Chart

  • CDP is a data platform that can pull data from multiple sources such as databases, APIs and SaaS applications.
  • CRM is a software tool that is used to manage customer relationship management (CRM) refers to the use of technology, processes and strategies for managing interactions with current and future customers. It can be considered to be similar to contact management or any type of database marketing system.

The bottom line is that CRM and CDP are two very different technologies with different strengths and weaknesses. If you’re choosing between them, it’s essential to understand their capabilities and limitations. But before making any decision, remember that both have a place in your business—and they can work together to create an even more powerful solution.